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12 March 1991 - Current

Page 4014
6 October 2010
                                 Second reading
Debate resumed.

  Ms  NEVILLE  (Minister  for  Community  Services) -- The second-reading speech
The community sector -- scope
The criteria for determining the scope of community services activities included
in the scheme have been developed in close consultation with the sector.

The bill requires that community sector  workers be included in the scheme based
on  a  whole-of-organisation  approach. That is, all  full-time,  part-time  and
casual workers employed to undertake  the community service activities listed in
the legislation will be included in the scheme.
The bill provides for only two exceptions to this rule:
        1. Where a  children's  service is  run  by an organisation  whose  core
                business  is unrelated  to  the community  services sector, only
                those workers  employed to provide  children's services will  be
                included in the scheme.
        2.  In registered community health centres, only those workers  employed
                to deliver  community  services  will be included in the scheme.
                Their peers providing health services will not be eligible.

The scope defining eligibility for the scheme has  been developed to ensure that
the legislation only captures community services sector employees.
All health  workers and all  those employed to provide community-based aged-care
services will not be included in this scheme. This has resulted  from  extensive
consultation with unions and organisations.

Page 4015
Consultations also identified that kindergarten teachers and assistants currently have access to unregulated portable long service leave arrangements that would be lost if those employees were included in this prospective scheme. In light of this, the bill excludes kindergarten teachers and assistants. Portability of entitlements The bill provides for community service sector employees to be entitled to long service leave benefits commensurate with those described in the Long Service Leave Act 1992. Employees will be entitled to 8.7 weeks leave after they have accrued 10 years of service with an employer or multiple employers across the sector. The bill also provides for those employees who receive additional entitlements, above the existing Long Service Leave Act. These additional entitlements can include access to a pro rata entitlement after seven years of service with a single employer without having to terminate their employment, or leave the sector. The bill also includes a provision to allow employers and workers to negotiate mutually beneficial arrangements for how long service leave entitlements may be used. This may include mutually agreed flexible working arrangements; this is not to replace or prevent other flexible arrangements negotiated from time to time. Jurisdiction of court proceedings I make the following statement under section 85(5)(b) of the Constitution Act 1975 of the reasons why it is the intention of clause 98 of the bill to alter or vary section 85 of the Constitution Act 1975. Clause 98 provides that it is the intention of that section to alter or vary section 85 of the Constitution Act 1975 to the extent necessary to prevent the bringing before the Supreme Court of an action of a kind referred to in clauses 40, 85, 91 and 92. Clause 40 provides that an employee may apply to the industrial division of the Magistrates Court for a determination regarding when their long service leave may be taken if the employee and the employer cannot reach agreement or where the employer provides the employee with notice directing the employee to take long service leave. Clause 85 provides that proceedings in relation to any offence against the bill must be heard and all penalties recovered by the industrial division of the Magistrates Court. Clauses 91 and 92 provide that where an employer has terminated or prejudiced the position of an employee for exercising their rights under the bill the industrial division of the Magistrates Court may impose a penalty on an employer or order the employer to reinstate an employee and reimburse the employee for any lost remuneration or compensate the employee where remuneration is not appropriate. The reason for limiting the jurisdiction of the Supreme Court in these types of cases is that the industrial division of the Magistrates Court has taken over from the Employee Relations Commission in industrial matters within Victorian jurisdictions. It is a specialist body that will provide cost-efficient and speedy determinations in these matters. Costs and funding Introducing a portable long service leave scheme will, out of necessity, create some cost and administrative changes for community sector organisations. Under this legislative framework, in-scope employers will be required to pay a levy for all workers who have a contract of employment. The levy will be paid on the total earnings for each employee, for each quarter. The levy will be managed by the scheme authority and used to pay administration costs of the scheme, as well as fund employee long service leave entitlements, when they fall due. Extensive actuarial analysis has been undertaken to ensure an ongoing, viable scheme for the sector. Under the bill, the scheme authority will have the power to set the levy rate to be paid by employers on a quarterly basis. Actuarial advice is that the initial rate should be set at approximately 1.6 per cent to be calculated at 1.4 per cent for employees' entitlements and 0.2 per cent for administration of the fund. Throughout the consultation process it was identified that some sector employers held concerns about the potential administrative and financial impact of the scheme. Extensive work has been undertaken to identify opportunities to reduce any financial and administrative burden that community sector employers may face.
Page 4016
As a result, employers will have the option of transferring administrative tasks associated with record keeping and financial management of out-of-scope employee entitlements, above-base entitlements and pre-existing entitlements to the scheme authority. This will enable organisations to reduce their administrative responsibilities in relation to managing long service leave entitlements. The government has agreed to provide financial assistance in the early stages of the scheme to assist employers to meet the initial extra costs of setting aside long service leave contributions. Implementation time line The bill will be implemented at a date yet to be proclaimed, as it will be of no effect until such time as the commonwealth passes legislation to allow the scheme to operate with the intended scope. The deferred debate and proclamation allows for the necessary legislative change to the Fair Work Act, to support the operation of this scheme. The commonwealth has signalled intent to accommodate state-based portable long service leave schemes in the near future. Secondly, the delayed proclamation date will allow time for community services organisations to adjust their practices and prepare for the transition to a portable long service leave scheme. The operation of the scheme will not commence for at least 18 months after the legislation is proclaimed to ensure there is sufficient time for transition, consultation, training and establishment of the new arrangements. The introduction of the scheme as outlined in this bill will provide the community services sector with a much-needed competitive advantage. It will provide additional benefits and help to ensure an ongoing, viable sector and effective delivery of services to the Victorian community. I commend the bill to the house. Debate adjourned on motion of Ms WOOLDRIDGE (Doncaster). Debate adjourned until Wednesday, 20 October.